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Currently on track to become law before Parliament's summer recess in July, the Renters’ Rights Bill is the most significant reform of the private rented sector since the Housing Act in 1988, and has wide-ranging implications for landlords, tenants, investors and letting agents alike. Below we break down how the Bill is set to impact the rental market. The removal of no-fault evictions Once the Renters’ Rights Bill comes into effect, serving Section 8 notices will be the only way that landlords can evict tenants, removing no-fault evictions as a way of doing so. No-fault evictions occur when a landlord evicts a tenant without giving a specific reason, often through section 21 notices, and are possible even if the tenant was paying rent on time and following the terms of the tenancy agreement. Under the new Bill landlords have to provide a valid reason like non-payment of rent or a breach of the tenancy agreement if they want to evict a tenant. That said, landlords can still vacate the rental property in order to sell, move family in or do major renovations, they just can't do it within the first six months of a tenancy. Removing ‘rogue’ landlords from the market A key part of the Renters’ Reform Bill is the introduction of a national database of landlords and property agents which will name those who have committed breaches, making it easier to track problematic landlords. Additionally, landlords who are found in violation of the new rules or who engage in unethical practices will face punishment like substantial fines or even a ban from renting out properties. The introduction of a landlord ombudsman The Bill also introduces a new landlord ombudsman, offering a fair and impartial resolution service for rental property disputes. The new ombudsman will provide an independent service for complaints about issues ranging from unfair rent increases and illegal eviction attempts to maintenance and safety issues. If tenants are unable to resolve these issues directly with their landlord or agent, they will have access to the ombudsman service to mediate and make a final decision without having to go to court. Properties need to meet a certain standard The Bill also aims to strengthen regulations around property living conditions and maintenance, requiring landlords to keep their properties in safe and good repair. Local authorities will now have the power to enforce these set standards, and landlords who fail to comply could face fines, or in extreme cases, be blacklisted from renting out properties. Rent increases will be restricted Under the current system landlords can raise rent in several ways, including rent review clauses, renewing fixed-term tenancies, and mutual written agreements during the tenancy. However, with the abolition of fixed-term tenancies, Section 13 notices will now be the only way to raise rent and can only be served once per year. With the introduction of the new system rent increases must be in line with market conditions and can’t be ‘excessive’, meaning that landlords have to show that the new rent is ‘reasonable’ based on local market norms. Landlords also need to provide a valid reason for any rent increase, such as improvements in the property, changes in the local rental market, or rising costs, and tenants will have the right to challenge unreasonable increases. Tailor my Property Ultimately the new protections offered by the Bill mean that tenants will receive better treatment and enjoy healthier renting experiences, likely leading to more renters trusting the market and landlords, and becoming reliable long term tenants once settled in a property. If you’re a current landlord or looking to explore the buy-to-let market as an investor but aren’t sure how to navigate the changing market, Tailor my Property has a professional network of property, finance and investment professionals who can assist with strategies suited to your individual needs. Get in touch today to find out more.

UK Renters' Rights Bill set to transform the rental market

The Renters’ Rights Bill has wide-ranging implications for landlords, tenants, investors and letting agents alike.

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Manchester has once again been named one of the top five UK cities for investors, leading the way in key areas of average total rent, the lowest number of rental vacancies, and a high percentage of the city’s population in the rental market. According to data from buy-to-let lender Aldermore, Manchester also tops the top five list with the best long term property price rises of all at 6.5% annual growth, offering rising value over time paired with the benefit of near guaranteed rental income. Voted the third best city in the world, Manchester offers a wide range of exceptional employment and educational opportunities, a thriving cultural scene, exciting growth projections and promising regeneration projects. Below we explain why investors should explore Manchester property in 2025. It’s a higher education hotspot With some of the UK’s most revered educational institutions located in Manchester, it’s no surprise that demand for rental property is high. Over 100,000 students from all over the globe are enrolled across the city, producing around 36,000 graduates every year. Research also indicates that around 46% of these graduates choose to stay in Manchester once they have completed their studies, creating a consistent flow of young professionals into the city. Employment opportunities Large businesses like Microsoft, Siemens, Amazon, Kellogg’s, Unilever, BBC and ITV all have prominent bases in the city, making Manchester a thriving business hub for workers from all over the world. With thousands of new jobs also being created as a result of regeneration efforts, demand for properties in the northern city continues to increase. High rental yields The average UK rental yield is 4.71%, while some of Manchester’s more popular areas achieve yields as high as 7.6%. The city also offers a consistent market of tenants, with 32% of locals being private renters compared to the national average of 23%. Manchester is continuing to experience immense rental growth according to the latest JLL research, which indicates that rents increased across the nation by 14%, with Manchester far exceeding this with 19.6% growth. Additionally, JLL predicts that the city will experience 19.3% further price growth and 21.6% rental growth by 2027, the highest forecasts across all UK cities. Property capital growth On top of having positive rental yields, Manchester properties are relatively cheap to purchase for buy-to-let investors. According to data from the Halifax Price Index the average property in Manchester costs £230,967, which is significantly cheaper than the average property in the UK and less than half of London’s average. That said, Zoopla has recorded year-on-year growth across the Manchester market of over 8% meaning the opportunity to buy property at lower prices could be over soon. Regeneration in the city As the UK’s second largest city region economy second only to London, Manchester has a GVA (Gross Value Added) of £74.85 billion, making it a major hub for investment. A £500 million town centre rebuild, currently one of the country’s biggest regeneration projects, is set to introduce a new cultural hub, public square, shops, community spaces and the building of more than 1,700 homes. These initiatives make the city an appealing option for renters hoping to enjoy quality of life while escaping the property prices of London and beyond. Good quality of life Manchester is beloved for its thriving local culture, offering everything from exciting nightlife to historical significance and a prominent sports scene, with a new planned football stadium set to become the largest in the UK, overtaking Wembley Stadium’s capacity of 90,000. From young students and professionals to growing families, the city offers something for everyone, and more and more people are looking to call the city home. Tailor my property Buy-to-let property in Manchester offers investors an exciting opportunity to capitalise on low property prices and consistent rental yields. For those looking to learn more about the area’s thriving market and the options available to investors, Tailor My Property has an expert network of property, mortgage and finance professionals who are able to advise and assist with a wide range of queries.

Manchester offers promising property investment opportunities

Manchester has once again been named one of the top five UK cities for property investors.

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The British housing market has experienced its strongest start in three years, with new sales up 12% year-on-year in January and the number of homes for sale 10% higher than a year ago according to property website Zoopla. With more homes available on the market there is also a surge in new people looking to buy, with demand for homes also 3% higher than the same time last year. Below we explore which factors are helping the UK property market enjoy a boom in activity. Stamp Duty Land Tax Last year’s autumn budget confirmed that the temporary reliefs in stamp duty land tax would come to an end in England and Northern Ireland in April 2025, meaning that certain buyers are rushing to complete transactions before the deadline passes and higher rates of stamp duty are imposed. According to Zoopla’s latest figures, first-time buyer demand jumped by more than a third in the months of November and December in the price brackets (between £300,000 and £625,000) where stamp duty will increase the most from April. Under the current rules, first-time buyers start paying stamp duty on purchases over £425,000 pounds, but this will fall to £300,000 on April 1. Other buyers currently start paying the tax on purchases over £250,000 and this will halve to £125,000 under the new rules. More houses available to purchase According to new year figures from property platform Rightmove, a record number of new sellers have come to the market since December - up 11% annually from last year. The number of buyers contacting agents during this period has also jumped 9%. This indicates that several sellers are now entering the market with a newfound confidence, providing buyers with fresh choice and increasing market activity. House price growth Recent data also indicates that the annual rate of house price inflation is currently at 2%, compared to -0.9% a year ago, indicating the highest level of price growth since April 2023. This means that the average house price in the UK now stands at £267,700, up £5,200 over 2024 with the number of homes for sale 10% higher than the same period last year. Lower mortgage rates At the latest meeting of the Monetary Policy Committee, the Bank of England decided to lower the base rate to 4.5%, from 4.75%. This followed several rate cuts in 2024 which means the base rate, which is used as a guide for interest rates on mortgages and other loans, has been reduced from the peak of 5.25%, and some lenders have started to introduce more competitive fixed-rate deals for buyers as a result. HSBC UK has reduced mortgage rates across its range of residential and buy-to-let mortgages by up to 0.47% for existing customers, and buy-to-let rates for those looking to remortgage to HSBC UK have been cut by up to 0.23%. Meanwhile, Skipton International has responded by reducing mortgage rates across its buy-to-let fixed rate range and adding a 3-year mortgage product at 5.89%. Tailor my Property With a series of factors positively impacting the UK property market, and with the stamp duty deadline looming, now is the ideal time to move ahead with property investment plans in the UK. That said, individual lenders will set their own mortgage rates and terms so it’s recommended to shop around for the deal best suited to your personal needs and goals. Contact Tailor My Property t oday and connect with our expert network of financial and property professionals who can assist and advise as you explore and navigate these exciting mortgage and property opportunities.

The UK property market enjoys a strong start to 2025

The British housing market has experienced its strongest start in three years, with new sales up 12% year-on-year in January.

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The milestone achievement of a child packing their bags and heading off to university will be special for any parent, but it can also be an opportunity to explore some financial planning opportunities by investing in a home for them whilst they are studying, potentially securing a long-term investment even after they’ve left. What are the benefits? As the owner, parents can choose the property’s location and quality, ensuring their child lives in a safe environment suited to their needs and preferences, and ultimately helping to ensure they will succeed in their higher education, which is an investment in and of itself. Compared to paying years of high student rents for properties owned by someone else, investing in a student property can be more cost-effective over the course of a degree, especially if you can rent out extra rooms to other students. Student properties in the UK have been offering incredible returns for investors, often times better returns than standard lets, and recent research by Paragon Bank found that student buy-to-lets can offer yields as much as 18% higher than on standard rental homes. What to consider? There are multiple strategies for parents looking to become student property owners, and the short term option would be to buy a one-bed for only their child, which they can sell on after they leave university. That said, this is not the recommended route for parents hoping to see more returns. If the owners are planning to only keep the property while their child is at university, the costs associated with buying, maintaining and selling will likely eat into the returns. The buying and selling costs include legal and estate agent fees, surveys, stamp duty and funds to refurbish, which means that buying a property for a short period doesn't make financial sense, and having a long term plan would benefit the property owners more. Financially it would make more sense to buy a larger property and rent out the other rooms to additional students, generating a rental income which could cover the mortgage payments and provide additional returns. Parents with a longer-term interest in being a landlord could plan to keep the property after their child is no longer studying, meaning they get a long-term income and are more likely to benefit from house price increases when they do come to sell years later. In fact, in many instances it can be a completely hands-off investment, as plenty of student accommodation has its own attached management company, meaning investors will have no landlord duties. Student housing attracts a consistent stream of tenants As the demand for higher education continues to increase the demand for student housing is growing alongside a shortage in rental properties available. University property owners will generally benefit from a predictable tenant cycle, so there’s less chance of risks like long void periods. With university students typically signing fixed-term contracts for an entire academic year if not longer, landlords can enjoy a consistent stream of income, often backed by other parental guarantors supporting their children. Student property provides higher rental yields According to a study by Savills, purpose-built student accommodation has consistently outperformed other sectors in the UK property market, delivering net yields ranging from 4.5% to 6.5% in recent years. Investment in the sector reached £3.5 billion in 2024, marking a 13% increase from 2023, and over the past five years, the sector’s annual investment volumes have averaged £4.9 billion, demonstrating its resilience despite ongoing market challenges. Student accommodation apartments are also generally smaller, so are occasionally available at a much more affordable rate, and the demand for quality student accommodation in prime locations near universities allows landlords to charge higher rental rates if they wish, maximising the potential rental yield. University cities like Liverpool, Manchester, Cardiff and Edinburgh are among those that are particularly high in demand, offering high rental yields thanks to the respectable universities associated geographically, along with thriving cultural scenes and cost-friendly living for students and young professionals both internationally and from the UK. Tailor my Property Overall, buying and managing student property is not only a strategic way to diversify an investment and property portfolio, it also offers parents a means of supporting and safeguarding their children during a potentially difficult and very fundamental period of their young lives. Tailor my Property has a network of property, tax and financial professionals who can assist with specific property and investment goals in the student sector. Get in touch today to find out how you can capitalise on UK student property potential in 2025.

The benefits of buying student accommodation for your children

Student properties in the UK have been offering incredible returns for investors.

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With 2024 proving more positive for the UK property market than many experts initially predicted, 2025 is primed to offer buyers, sellers and investors incredible opportunities, with widespread predictions of a ‘buyer’s market’ for house hunters in the year ahead due to increased property availability. 2025 will be a ‘buyer’s market’, but what does this mean? According to property company Hamptons, transaction numbers for the UK market are expected to increase this year as a result of first-time buyers, who accounted for a record 31% of all sales in 2024. With new buyers currently facing less competition compared to the pandemic-era markets, they also have a slightly larger selection to choose from, allowing them to buy the right property at the right price point. That said, upcoming changes to stamp duty land tax in April could also mean the current heightened transaction numbers are inflated as a result of a potential rush to buy property before the changes come into effect. Stamp duty land tax Property market professionals are expecting to see the number of house sales increase over the next few months as buyers try to finalise purchases ahead of the stamp duty changes scheduled for April. Changes to the current stamp duty thresholds will see house buyers in England and Northern Ireland start paying stamp duty on properties over £125,000, instead of over £250,000, the current threshold. First-time buyers currently pay no stamp duty on homes up to £425,000, but this will drop to £300,000 in April. As a result, first-time buyer activity is expected to see a boom as buyers rush to finalise purchases before the deadline. That said, it’s worth noting that most transactions can take several weeks if not months to finalise, and moving ahead soon is recommended for anyone hoping to close before the new thresholds kick in. House prices are still on the rise According to the Nationwide house price index, house prices ended 2024 at 4.7% higher than at the start of the year, meaning that the average home in the UK cost £269,426 at the end of December. Additionally, house prices are forecast to rise by 3% across Britain in 2025, followed by 3.5% in 2026 and 2.5% in 2027, according to Hamptons. House prices have been following an upward trajectory in recent months due to a drop in mortgage rates, rising wages and an easing of price inflation, which ultimately puts less pressure on buyer’s wallets. Dropping interest rates The downward direction of mortgage rates in recent months has been a significant force influencing buyer sentiment, with decreased monthly mortgage costs inspiring improved confidence amongst prospective buyers, prompting the moderate house price growth and increased numbers of transactions the market has enjoyed over the past few months. Market analysts are widely predicting that the Bank of England will further cut interest rates throughout the year, possibly as early as next month, allowing lenders to cut the cost of new fixed mortgage deals. In fact, experts are now predicting that the Bank of England will cut rates three times by the end of 2025. This, along with potentially rising wages, should improve housing affordability in 2025. Tailor my Property With conditions set up to allow the UK property market to flourish in 2025, there are certain opportunities primed for property investors to explore further, particularly before the stamp duty land tax deadline arrives. Tailor my Property has an extensive network of tax, property and investment professionals who can assist you with tailoring a strategy best suited to your unique property market aspirations.

2025 looks bright for the UK property market

2025 is primed to offer buyers, sellers and investors incredible opportunities.

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Despite a number of ups and downs throughout the year, 2024 turned out better than most expected for the UK property market. Inflation was near, or at, target, for much of the year, and the Bank of England started its interest rate cutting cycle, creating positive momentum that will flow over into the new year. Below are some of our UK property market predictions for 2025. House prices are set to rise According to forecasts from property platform Rightmove, house prices across Great Britain are set to rise in 2025. Rightmove predicts that national average asking prices will increase by 4% in 2024, their largest prediction for price growth since 2021. The property platform expects that the number of homes for sale will remain high next year, anticipating a higher number of around 1.15 million transactions in 2025. Mortgage rate reductions in 2025 According to Rightmove the average five-year and two-year fixed mortgage rates are likely to be around 4% by the end of next year, based on current market trends. This is lower than the current 4.8% and 5.08% for the five-year and two-year fixed rates respectively, and will likely help improve affordability and further boost consumer confidence. Changes to mortgage rates are difficult to predict because they are greatly dependent on the impact of a wide variety of unpredictable factors, including global financial markets, the cost-of-living crisis, geo-political tensions and inflation. Stamp duty land tax In September 2022, the Government announced a temporary increase to the thresholds above which stamp duty land tax must be paid. The temporary increase is due to end on 31 March 2025, meaning the market is likely to see a particularly busy first three months of the year as first-time buyers, home-movers and investors all try to complete planned purchases and avoid higher taxes. While this date might seem far away, buyers and sellers alike should note that an average residential property transaction takes between 12 and 16 weeks to complete, and could take even longer. From 31 March 2025 the stamp duty rates on a standard residential purchase of a freehold property for a UK resident will be 2% above £125,000 and up to £250,000, 5% above £250,000 and up to £925,000, 10% above £925,000 and up to £1,500,000, and 12% above £1,500,000. By completing the transaction before the stamp duty changes come into effect, a buyer can save a significant £2,500, meaning that it may be worthwhile for residential buyers to bring forward their property plans and take advantage of the current stamp duty rates before the increase takes effect. Rent Most property experts predict that the supply and demand imbalance across the rental market will persist in 2025, with rents expected to continue rising throughout the year, but at a slower rate and more in-line with the long-run average. Demand for rental homes has soared since 2020, consistently pushing up average asking rents. Property platform Zoopla found that between 2021 and 2024 average UK rents increased by 27%, with wages only increasing by 19% during the same period. According to their data, the imbalance between demand and supply of rental properties has narrowed, but at the end of 2024 the number of available rentals was still 18% lower than before the Covid-19 pandemic. This means that landlords advertising properties to rent in the new year will need to find a balance between growth that reflects their rising costs and what tenants can afford, but that rental properties are still providing consistent returns on the investment. Good regions to explore for investment in 2025 Below are some of the key areas worth exploring for property investment in the UK. Manchester boasts a thriving economic landscape, a growing population of young professionals, and significant investments in major infrastructure. It has one of the biggest student campuses in Europe and specific areas like the city centre, Salford Quays, and MediaCity offer good rental yields and strong potential for capital growth. Liverpool has undergone substantial regeneration in recent years, making it an appealing choice for property investors. The city offers a vibrant cultural scene, some top universities, and many job opportunities. Edinburgh is recognised as one of the most desirable places to buy property in the UK. This Scottish capital city attracts a significant number of young professionals and students and its strong rental demand and limited supply have contributed to increasing rent levels and high rental yields. Birmingham is a thriving midlands city with a major business sector and excellent transport links. The city's ongoing redevelopment includes the HS2 station, which is expected to drive rental demand thanks to the increased accessibility it offers to the region and other economic hubs. Tailor my property As we usher in 2025 the UK property market is primed to offer buyers new opportunities to invest in property and explore new markets. For those looking to engage with the UK property market, or take advantage before the stamp duty tax changes take effect, Tailor My Property has an expert network of property, mortgage and finance professionals who are able to advise and assist with a wide range of specialist queries. Get in touch today to find out more.

UK property market predictions for 2025

2025 offers property investors many exciting opportunities.

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In a move that had been largely predicted by analysts and financial experts, the Bank of England has cut interest rates for the second time this year. The Bank’s monetary policy committee voted by a majority of eight to one to reduce rates and ease the pressure from high borrowing costs, setting the new rate at 4.75%, down 0.25% points from 5%. That said, the Bank has since warned that inflation is likely to increase as a result of the autumn Budget, higher taxes, and increased borrowing, which will all likely add about 0.5% points to headline inflation by the middle of next year. Inflation, which measures the pace of price rises, fell below the Bank’s 2% target in the year to September, but was always expected to rise again after gas and electricity prices rose last month. It was then forecast to drop back to 2% by 2026, but the Bank now expects that to happen in the following year 2027. The UK property market responds to the interest rate cut  Interest rate cuts typically positively influence the UK property market, leading to increased buyer confidence with lower interest rates which can lead to a surge in buyer activity, higher property prices, and improved return on investment for investors. Following the news of the decision to cut rates the pound rose against the US dollar, while financial markets reacted by betting that Threadneedle Street would cut interest rates fewer times and at a slower pace over the coming year. Chancellor Rachel Reeves quickly welcomed the decision by the Bank, but said she is ‘under no illusion about the scale of the challenge facing households’.  The latest cut has joined a number of favourable conditions for the property market in recent months, with increased supply, heightened buyer and seller activity, and a renewed confidence following the pandemic era. Will the rate be cut further?  The Bank of England’s governor, Andrew Bailey, has indicated that borrowing costs are still likely to come down in future, but he cautioned anyone with expectations that it will happen soon. ‘We need to make sure inflation stays close to target, so we can’t cut interest rates too quickly or by too much. But if the economy evolves as we expect it’s likely that interest rates will continue to fall gradually from here,’ he said. With market speculation that Donald Trump’s US election victory will also lead the way for renewed inflationary pressures globally, Bailey believes a ‘gradual approach’ to cutting borrowing costs is required as the Bank waits to see if Trump will impose import tariffs on America’s trading partners. Tailor my Property  Lower interest rates offer exciting opportunities for the UK property market, whether you’re a first time buyer or a seasoned property investor. This cut also comes at an exciting time, as many potential buyers are aiming to complete purchases before the possibility of future stamp duty changes, as hinted in the autumn budget. Consulting with an industry professional is vital to ensure you move in the right direction for your personal, financial and property goals, whether it be renting, buying or selling property in the UK market. Contact Tailor My Property today and connect with our expert network of financial and property professionals.

Will the Bank of England cut interest rates further?

In a move that had been largely predicted by analysts and financial experts, the Bank of England has cut interest rates for the second time.

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Labour’s first budget delivered by Chancellor Rachel Reeves may not have proven as disastrous as many had feared, but it will likely have far reaching consequences for the UK property market over the long term. Below we break down some of the major points outlined in the autumn budget. Stamp duty land tax Stamp duty land tax In a move that was widely predicted, the Chancellor introduced changes to stamp duty land tax, announcing that people who want to buy a second home will be hit with additional charges in a move the government believes will benefit first-time buyers. Reeves claims that this will result in another 130,000 property transactions for first-time buyers and people buying a primary home over the next five years. Currently, buyers of homes worth less than £250,000 in England and Northern Ireland don't pay stamp duty (land tax is set separately in Scotland and Wales). This was doubled from £125,000 in September 2022. The threshold for those buying their first property is £425,000, which was raised from £300,000, but these higher thresholds will come to an end on 31 March 2025. From the start of November the higher rates for additional dwellings went up from 3% to 5% for anyone who already owns a primary home, and is charged on top of the main stamp duty rate. On a property costing £300,000, this means an extra £6,000 in tax. This 2% increase for additional properties will likely be felt more in areas like London and the South East, inevitably leading to higher rents, and will probably result in a smaller demand from second home buyers and investors. This will likely cause a further redistribution of investment towards the lower end of the price spectrum, and sway people away from the capital to the regional markets growing in popularity. Capital gains tax Capital gains tax is a tax paid on the profit made when someone sells certain types of assets, including UK property. Reeves’ budget made changes to capital gains tax overall, but ultimately left the existing rates for residential property as they were. The rates for residential property will stay the same, at 18% and 24%, while the rates for the sale of other types of assets, including commercial property, are being increased. This might ultimately benefit the residential property market, given that thresholds for the tax were frozen while it increased for other assets. This could lead to investors choosing to pursue more opportunities in the residential property market and ultimately will result in positive growth and likely returns. Inheritance tax In the lead up to the budget announcement some senior homeowners might have feared a cut in the inheritance tax reliefs available to them, but the current threshold remains in place after the budget announcement. This means that a couple do not pay tax on the first £1 million of wealth on their main home, and will hopefully add to the incentive for older property owners to downsize and pass housing wealth down through the generations to those who might struggle to get on the property ladder otherwise. Regional areas grow in popularity thanks to government support In a continuation of investment and regeneration plans that are widely benefitting certain regional property sectors, Manchester and the West Midlands have been designated as recipients of increased funding and support. The government announced that ‘integrated settlements’ will be implemented for greater Manchester and the West Midlands at the start of the 2025-26 financial year, along with four other mayoral combined authorities, namely the North East, South Yorkshire, West Yorkshire and Liverpool City Region. This support continues to bolster demand for regional property outside of the capital which is proving too competitive for many potential buyers and renters. With higher education, business and lifestyle developments continuing to flourish in areas like Manchester and the West Midlands, many investors are likely to explore these areas for opportunities that provide higher and more consistent rental yields and property appreciation in years to come. Tailor my Property As the autumn budget’s policies go on to influence the property market it is important to move ahead with caution and strategy so as to best protect your interests and investment goals. Tailor my Property has an extensive network of tax, property and investment professionals who can assist you with tailoring a strategy best suited to your unique market aspirations. Get in touch today to find out more.

How will the UK’s autumn budget impact the property market?

Labour’s first budget will likely have far reaching consequences for the UK property market over the

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In a few days’ time Labour Chancellor Rachel Reeves will deliver her first Autumn Budget statement since the party came into power earlier this year, and experts predict that the UK property market will be one of the sectors to see some big changes. According to property website Rightmove, buyer ‘jitters’ ahead of the budget have slowed down a typical autumn bounce in house prices. The average asking price for a UK home rose 0.3% month on month to £371,958 in October, a smaller increase than expected at a time of year when the market typically picks up. Below we break down which aspects of the market might be discussed. Energy efficiency As building standards in the UK change to include measures aimed at reducing its carbon footprint, energy secretary Ed Miliband recently confirmed Labour’s plans to tighten the rules, meaning that it is something for property investors to bear in mind for any existing or future property investments.  For landlords, investing in new-build property is one of the most popular and potentially cost-effective ways of ensuring compliance with any upcoming energy efficiency standard changes. Falling inflation Last week the Office for National Statistics revealed that inflation had fallen to 1.7%, its lowest level in three years, and well below the government’s 2% target. This means that property owners will likely benefit from an interest rate cut and a subsequent mortgage rate cut. According to Rightmove, the market is likely to be supported by lower mortgage costs after the budget, and the average five-year fixed mortgage rate was 4.6% last week, down from 6.11% at the peak in mid-2023. Buyer confidence may also get a boost from interest rate cuts by the Bank of England. Experts currently predict that the rate-setters are likely to reduce borrowing costs for a second time next month, and that there is a chance of another drop in December. Capital gains tax Labour has previously said that it won’t implement changes to this tax, which is placed on the gain that arises when you sell an asset, but rumours have been circulating in recent days that this could change. Sir Keir Starmer has already ruled out charging capital gains on someone’s first home, which is exempt under the current system, but did not extend that promise to any rise. An increase in the rate, or a cut in the current £3,000 threshold at which it becomes due, would affect second homeowners, landlords, business owners, shareholders and those selling valuable assets. The Chancellor could either increase the main rate of capital gains tax, which is typically either 10% or 20%, or expand the base of assets liable for the levy. The housing shortage To address the UK market’s growing need for homes, the Labour party has vowed to build 1.5 million houses over the next five years, a rate of house building last seen in the 1960s. Labour has reinstated minimum housebuilding goals for the UK, but on a much more targeted basis, in a bid to give a boost to the areas with the highest need, and this could have the most positive impact on the North and the Midlands. In recent years the strongest returns for landlords and property investors has been found in the property markets of these regions, so a regeneration boost and additional housing could see even greater gains in these locations. The budget is likely to include more information related to this. Stamp duty land tax According to the Institute for Fiscal Studies (IFS), stamp duty ‘has a claim to be the most economically damaging tax in the UK. It makes both housing and labour markets less efficient, as a drag on growth.’ Currently any property sold for £250,000 or less is exempt, while the next £675,000 is subjected to a 5% levy, which reaches a peak of 12% for the most expensive homes. Stamp duty currently raises the sizeable sum of £13 billion a year and an increase worth around £1.5 billion is already scheduled for April 2025, so it is unlikely that any other changes will be announced in this week’s budget. One likely announcement in the budget however is a 1% increase in the stamp duty surcharge for overseas buyers. This would make buying UK properties pricier for foreign investors but it could mean less competition in the market for UK buyers. Tailor my Property Consulting with an industry professional is vital to ensure you move in the right direction for your personal financial and property goals, whether it be renting, buying or selling property in the UK, particularly with the potential market changes arising from the Autumn budget. Tailor my Property’s expert network of property, finance and investment professionals will be able to assist you with assessing the market and moving ahead with peace of mind and clarity. Get in touch today to find more.

The UK property market braces for Labour’s Autumn budget

Experts predict that the UK property market will be one of the sectors to see big changes in the Autumn budget.

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As the UK property market responds to changing interest rates, newly developing areas and a continuing supply and demand crisis, rent prices have reacted accordingly across the country. Rents have risen by an average of 5.4% in the last year, and the average rent for new lets in the UK is at £1,245 according to property platform Zoopla. Which factors fuelled the current state of the UK rental market? The latest data indicates that demand for renting has cooled slightly over 2024 but remains high by pre-pandemic standards. The post-pandemic years have seen demand for rented homes rise to record highs which, together with falling housing supply, pushed rents higher. Rental demand started to increase in 2021 as the economy re-opened thanks to the resumption of international travel, alongside changes in visa rules for workers and students at a time when the UK jobs market was also recovering.  The jump in mortgage rates over the latter half of 2022 and 2023 also made buying a property more expensive, keeping potential buyers in the private rental sector and increasing the demand for rental properties. Winter will likely cool market conditions slightly Rental prices across the UK have risen sharply over the past year but data indicates that the lower 5% increase in September could prove that prices are beginning to soften, a trend that may continue as winter approaches. According to the latest Goodlord Rental Index, year-on-year figures have generally been higher throughout the year, with reports of 7% increases in former months. The average rental cost for a property in England was recorded at £1,147.26 in December 2023, and softer conditions are common for the market in winter as less social factors like university terms and job relocations tend to take place over the festive holiday period. Will rent prices remain elevated? According to Zoopla there are currently 18% more rental homes available than this time last year, as lower mortgage rates recently enabled some renters to exit the rental market to buy their first properties. Despite this though there are still 24% less homes available than before the pandemic, which is limiting choice for renters as the housing shortage continues to impact the market. As the government slowly tries to increase the supply of affordable housing the private rented sector will likely continue to see high demand from those on lower incomes, and higher competition for a small pool of properties means that landlords have an opportunity to set prices in their favour. As a result it seems likely that elevated rental prices are here to stay for the foreseeable future, even if with the slight fluctuations predicted for the winter months. Which areas offer the best rental yields? The UK’s largest cities have recorded some of the greatest growth in average rents, averaging over 10% per year for the last three years. This pace of rent rises has proven unsustainable and means that affordability is now starting to impact rental growth in major centres. As a result, London and other major cities across the UK have been leading the slowdown in rental inflation in recent months.  According to Zoopla the greatest slowdown has been in the capital, where rents are rising at just 2.5%, down from over 12% for London properties last year. Property website Rightmove’s figures for the third quarter of 2024 across Britain show that the average rent advertised for London properties reached a record of £2,694 per month recently. Rental growth is also slowing quickly across the UK’s other largest cities, the so- called ‘core cities’, with rents 5.8% higher over the last year, down from 10.7% a year ago according to Zoopla. These cities include Nottingham, Bristol, Manchester, Liverpool, Sheffield, Newcastle, Birmingham, Leeds, Edinburgh, Glasgow and Cardiff. Rental inflation in non-city areas continues to run at an above-average rate of 6.8% - 7.4%-a-year. This reflects high demand being pushed into more affordable areas, often adjacent to the larger cities which are key employment centres. Landlords and investors brace for the Autumn budget As the market prepares for Chancellor Rachel Reeves’ budget on October 30 th some landlords are bracing for a potential Capital Gains Tax rise, as well as new Energy Performance Certificate regulations for and potential mentions of the Renters Rights Bill, all factors which could impact the rental market significantly. These potential tax and policy changes mean that it is imperative for landlords and property investors to consult industry professionals to ensure they navigate the market with their best interests in mind. Tailor my Property offers an experienced network of property, investment and financial professionals who can assist with specific goals and queries across the broader United Kingdom. Get in touch today to find out more.

UK rental prices are expected to continue rising

Rents have risen by an average of 5.4% in the last year, and the average rent for new lets in the UK is at £1,245 according to Zoopla.

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I’m a non-resident, so would I have to cash-buy? In short, absolutely not. What is true is that the non-resident lending environment is very different to that for domestic UK borrowers – there's a more limited field of options to choose from, interest rates are likely to be a little higher, and the max loan size smaller. But, at the same time, there’s nevertheless an established market of options. Working with a variety of brokers, we have access to the whole of this market, which consists of around 15 buy-to-let lenders. Some of these will only be available to British citizens, but that certainly isn’t the case across the board. As a non-British resident or citizen, you can still typically borrow up to 75%, with rates more or less comparable to those for British citizens. Further, if you’re buying property to use yourself rather than rent out, there’s a limited but more competitive field of mortgage options to choose from. Regardless of whether it’s a buy-to-let or residential mortgage, you don’t need to have credit history in the UK. Lenders are happy to accept proof of income in overseas currencies, and a lack of background in the UK.  Are rental guarantees always a positive thing? Particularly overseas, as part of large-scale, investor-led developments, properties are often advertised with one, two, or even longer fixed periods of rent assured by the developer. At face value, this sounds extremely appealing – landlords don’t have to rely on tenants and have the security of knowing they’ll have income coming in regardless.  It’s also true that, on occasion, we’ve put properties to clients that do have rental guarantees in place, as part of a wider investment case that we think stacks up.  In most cases, however, look beyond the surface and rental guarantees become a little more problematic. Very often, a rental guarantee goes hand-in-hand with a highly inflated property price, so in effect this income is ‘baked into’ the amount the investor is paying upfront.  Also, the definition of ‘guaranteed’ needs some scrutiny. In reality, rather than rely on the financial stability of the tenant, landlords are relying on the developer, who like tenants will only be able to pay rent if they have the capital to do so. For these reasons, something that Tailor My Property find much more appealing are completed properties that have sitting tenants in place. This means investors aren’t running the same risk of paying an above-market price, and have much more control over the tenants in their property, whilst still receiving rent from day one. Will I always be paying a premium on new-build properties? It’s absolutely true that new-builds can be more expensive than traditional, resale properties. Particularly in Asia, and in the Middle-East, there’s a lot of large-scale, off-plan developments advertised, replete with glossy brochures and models, and which come with gyms, swimming pools, and prices that are far above the going rate for the local area. They’re also the kind of properties that, in our opinion, are less appealing to local buyers and renters. In other words, there’s a reason they’re being marketed almost exclusively overseas. That being said, we also believe there are many advantages to buying the right kind of new-build. Firstly, they tend to be far more hands-off than older properties with immediate wear and tear to address. In terms of being protected, buying new build typically gives you a 10-year warranty against structural defects, and assurances that the building conforms to current building, and fire and safety standards in the form of EWS1 certification. Further, energy-efficiency has become a real industry buzzword, with soaring utility bills giving rise to demand for modern, more sustainable properties with cheaper running costs. This is also supported via lenders with the offering of green finance products. So, what we’re seeing is a swell in demand for new-builds, amongst investors, owner-occupiers and renters alike. The challenge, then, is identifying what kind of new build is the right kind of property, as opposed to those that are inflated and less appealing to a local demographic. That’s where Tailor My Property can help. Receiving different properties from our partners on a daily basis, we filter those that we believe make sense from those that we think don’t, and focus on these with our clients. As a general rule of thumb, we concentrate on small as opposed to large-scale new build developments, built with a design and architecture that is sensitive to the history and existing character of the area, or that retain the features and identity of the building if it’s a refurbishment. Is UK property all about London? Historically, the UK has been relatively monocentric as a housing market, with London dominating when it comes to volumes of transactions – particularly amongst international investors.  Indeed, London continues to represent long-term reliability, with historical trends demonstrating consistent gains over virtually any 10-year period, supported with extremely strong rental occupancy. That being said, the landscape has certainly changed in recent years, with a more even redistribution of investment across the UK.  In part, this is because of the London market itself. Yes, it still makes sense over long time periods, but of late price growth has been in negative territory and five-year forecasts predict shallow, albeit positive, changes in prices.  Added to this, whilst occupancy levels are high, rental yields in percentage terms track behind the UK average, meaning it is harder for the number to stack up on a cash-flow basis. At the same time, regional areas have really emerged as appealing investment locations in recent years, driven by political support, infrastructure changes, commercial relocations, and the subsequent influx of potential renters into core regional cities.  Data over the last few years clearly underlines this, with price growth outstripping London in cities such as Manchester and Birmingham, and forecast to continue doing so in the short to medium term.  Therefore, there’s nowadays much more to UK property than London. There are various locations, each with different rental expectations, price growth and trajectories over different timespans.  What Tailor My Property are here to help with, therefore, is in identifying a client’s priorities, and subsequently the location that it most attuned to their objectives.  Is it always best to buy through a limited company? Purchasing a UK through a limited company is becoming increasingly common for buy-to-let investors, including those living overseas, and there are a number of potential benefits to doing so. Chief amongst these is the paying of a flat rate of corporation tax on rental income, as opposed to tiered income tax.  The ability to earn shares rather than rental receipts also gives greater flexibility, as does the ability to incorporate shareholders in the company. Fortunately, lenders are slowly adapting to this by accepting applications from companies, and some of the core non-resident lenders will now lend in this scenario.  However, it’s also true that the lending landscape remains more limited for non-residents compared to buying in their own name, and investors should expect to be paying a slightly higher interest rate as a result. Add this to the costs of setting up and maintaining the accounts for limited companies, and the benefits of purchasing through this structure could be negligible, if not non-existent.  This is particularly true for smaller properties where the rental income is relatively low, and when you don’t already own additional UK properties.  The more accurate assessment, therefore, is that purchasing through limited companies can be highly beneficial dependent on personal circumstances – the level of rent on the property; whether you own property already; whether you plan on returning to the UK; you and your family’s future plans for your property portfolio; and various other factors.  For this reason, we’d highly recommend speaking to a tax advisor who can undertake personalised tax planning with you – something we can help to set up.

UK property: Five questions and misconceptions

Tips for expats looking to explore the UK property market.

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As the summer months come to an end and the market goes into an anticipated winter slow-down there are several indicators suggesting that both demand and supply remain positive for the UK housing market. Savills’ predictions Since Savill’s last November forecasts the outlook for 2024 has largely improved as a result of promising economic conditions and lower borrowing costs. At the beginning of last November Savills forecast that house prices would fall by an average of -3.0% in 2024 and that housing transactions would remain at around 1m for the year. At that time a 75% loan to value mortgage from Nationwide on a two-year fix cost 5.34% and mortgage approvals were down below 50,000 per month. As a result of a more stable market and improved buyer sentiment in 2024 they now expect UK house prices to rise by 2.5% this year. Post-summer house prices The latest market data indicates that UK house prices hit a two-year high last month, in a sign that the property market has recovered from the aftermath of Liz Truss’s infamous mini-budget that sent borrowing costs soaring in 2022. Asking prices were also up by 0.8% in September, according to Rightmove, double the typical month-on-month average for this time of year, pushing the average cost of a property to £292,505. The north-west of England reported the strongest annual growth at 4%, while London continues to have the most expensive property prices in the UK, at an average of £536,056, an annual increase of 1.5% compared with last year. Long term predictions show a similar trend, and the north west continues to offer investors and buyers exciting opportunities as enthusiasm for cities like London wanes thanks to a rising number of digital nomads who can work from anywhere and a growing sentiment among first time buyers purchasing for a higher quality of life. With its prime location, buzzing student population and growing popularity for major companies to set up new bases, north west cities like Manchester have seen exciting house price growth in recent years, with Savills predicting growth will hit 28.8% by the year 2028, the highest of its predictions across the UK. Manchester is currently undergoing regeneration in the city center and surrounding areas, with many properties available for purchase, and with the average cost still far below what you can expect to pay in London, averaging £246,891 in the last 12 months, it’s an exciting prospect for buyers and sellers. On the other hand, Savills’ five year prediction for London is the lowest out of the nation, at just 14.2%. Demand for property in the capital and the city’s population growth has outpaced its development, and according to a study by the Institute for Fiscal Studies, house prices in London are £21,000 higher over five years than they would have been if the capital had kept pace with the rest of England’s. Mortgage rates Increased market activity this year has been supported by falling mortgage rates. Lending rates had been dropping in the lead-up to the much anticipated cut to the base rate that occurred at the start of August when the Bank of England dropped the rate to 5%. Several lenders are now offering loans with rates below 4%, with Barclays and Nationwide launching five-year fixed rates at 3.71% and 3.74% respectively, tempting many first time buyers who had previously delayed plans to join the property ladder. Long term market forecasts Oxford Economics’ forecast for GDP growth over the next five years has increased from 7.2% to 8.9%, and wage growth predictions grew from 15.8% to 16.4%. This combined with interest rate cuts has led to Savills updating its five-year UK forecast from 17.9% to 21.6%, and the distribution of growth is also now expected to be slightly more even over the five-year period. A strong economic performance in 2025 and 2026 will support buyer sentiment and likely further stimulate the UK property market. Tailor my Property With the property market showing signs of consistent buoyancy, now might be the perfect time to move ahead with property and investment plans. Consulting with an industry professional is vital to ensure you move in the right direction for your personal financial and property goals, whether it be renting, buying or selling property in the UK market. Contact Tailor My Property today and connect with our expert network of financial and property professionals who can assist and advise as you explore and navigate potential opportunities

Savills offers positive predictions for the UK property market

There are several indicators suggesting that both demand and supply remain positive for the UK housing market.

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